Ubs Group Ag · SIX:UBSG
Ubs — UBS AG (Amna, Amnd, Amtr, Amub, BDCX, BDCZ, Cefd, DJCB, Esus, Fedl, HDLB, Ifed, Iwdl, Iwfl, Iwml, Mlpb) — Q1 2011 Earnings Presentation
34 slides from Ubs's earnings presentation, Apr 26, 2011
Slide 1: First quarter 2011 results
First quarter 2011 results First quarter 2011 results April 26, 2011
Slide 2: Cautionary statement regarding forward-looking statements
Cautionary statement regarding forward-looking statements This presentation contains statements that constitute "forward-looking statements," including but not limited to management's outlook for UBS's financial performance and statements relating to the anticipated effect of transactions and strate
Slide 3: 1Q11 highlights
1Q11 highlights 1 Own credit on financial liabilities designated at fair value CHF 1.8 billion net profit attributable to shareholders Diluted EPS CHF 0.47; return on equity 15.5% Over CHF 20 billion net new money for the Group; CHF 11.1 billion for Wealth Management CHF 1.0 billion pre-tax profit e
Slide 4: 1Q11 - performance by business division
1Q11 - performance by business division 1 Own credit on financial liabilities designated at fair value 2 Operating profit from continuing operations before tax
Slide 5: Net profit attributable to shareholders 1Q11 vs. 4Q10
Net profit attributable to shareholders 1Q11 vs. 4Q10 4Q10 Own credit1 Tax expense / (benefit) 1Q11 Personnel expenses Non-controlling interests Credit loss expenses Operating income excluding own credit and credit losses Non- personnel expenses 1 Own credit on financial liabilities designated at fa
Slide 6: 1Q11 operating expenses
1Q11 operating expenses Higher personnel expenses more than offset reduced litigation provisions Personnel costs comparable to 1Q10 levels 1Q11 personnel expenses include CHF 467 million related to the amortization of bonus awards granted in prior periods Annual salary increases (effective 1 March)
Slide 7: Changes to reporting - effective 1Q11
Changes to reporting - effective 1Q111 Income lines split into interest, fees, trading and other income Comparison with the prior year quarter Total litigation provision charges shown separately 1 Refer to the "Accounting and reporting structure changes" section and "Note 1 Basis of accounting" in t
Slide 8: Wealth Management
(CHF million) Wealth Management Operating income and pre-tax profit Pre-tax profit increased 40% on higher income and lower expenses Net new money Quarterly average Operating income up 7% on improved client activity and higher interest income Reported costs down 4% mainly due to lower G&A expenses 4
Slide 9: Wealth Management - revenues
Wealth Management - revenues Revenues up 7% on higher interest income and increased client activity Interest Fees excluding transaction-based fees Trading Other income 13% 3% 10% 1Q11 vs 4Q10 (CHF million) Invested assets (CHF billion) 18% Transaction-based fees
Slide 10: Wealth Management - gross margin
Wealth Management - gross margin1 (bps) 1 Operating income before credit loss (expense) or recovery (annualized) / average invested assets; gross margin excludes valuation adjustments on a property fund of CHF 17 million in 2Q10, CHF 28 million in 1Q10, CHF 155 million in FY09 and CHF 9 million in F
Slide 11: Wealth Management - invested assets and NNM by region
4 Wealth Management - invested assets and NNM by region1 31.3.11 invested assets CHF 791 billion 1 Invested assets and net new money based on client domicile 2 Includes Western Europe and all other countries not covered elsewhere 3 LatAm, Middle East & Africa and Central & Eastern Europe 4 UHNW clie
Slide 12: Retail & Corporate
Retail & Corporate (CHF million) Stable profits, low credit loss expenses Operating income up 4% as lower credit loss expenses offset lower revenues Revenues down 2% as lower interest income was partly offset by higher transactional fees Credit loss expenses totaled CHF 7 million compared with CHF 6
Slide 13: Retail & Corporate - loan portfolio
Retail & Corporate - loan portfolio Over 70% of loans outstanding are secured by residential mortgages Loans, gross (31.3.11) Loans secured by residential property (31.3.11) 100% = CHF 136 billion 1 This distribution shows the loans in the respective LTV buckets. For example, a CHF 1 million mortgag
Slide 14: Wealth Management Americas
Wealth Management Americas Operating income down 2% (up 2% in USD terms) as currency effects offset higher fee and commission income Operating expenses decreased 12% (9% in USD terms), mainly due to lower litigation provisions Financial advisor attrition near historical lows CHF 3.6 billion net new
Slide 15: Wealth Management Americas - operating income
Wealth Management Americas - operating income Currency effects offset increase in underlying USD fee & commission income CHF million USD million Interest Fees Commissions Trading Other income & CLE YoY (1%) YoY +13% QoQ +2% QoQ (2%)
Slide 16: Wealth Management Americas - financial advisor productivity
Wealth Management Americas - financial advisor productivity Improved financial advisor productivity in US dollar terms Revenue per FA, annualized (thousand) Invested assets per FA (million)
Slide 17: Global Asset Management
Global Asset Management Operating income decreased 8% Net management fees decreased primarily in A&Q, Global Real Estate and Fund Services Performance fees decreased by CHF 19 million compared with a very strong 4Q10 Operating expenses down, mainly due to lower personnel expenses CHF 5.6 billion net
Slide 18: Investment Bank
Investment Bank CHF 1 billion pre-tax profit excluding own credit1 1 Own credit on financial liabilities designated at fair value (CHF 133 million charge in 1Q11) Operating income excluding own credit1 Pre-tax profit and cost / income ratio (CHF million) Pre-tax profit excluding own credit1 Pre-tax
Slide 19: Equities revenues (vs. 1Q10)
Equities revenues (vs. 1Q10) Cash: strong performance in Asia Pacific and the US partially offset by lower revenues in Europe, Middle East and Africa Derivatives: Derivatives revenues decreased slightly despite a stronger performance in Asia Pacific; 1Q11 does not include commodities revenues now re
Slide 20: FICC revenues (vs. 1Q10)
FICC revenues (vs. 1Q10) Macro: FX revenues marginally down on lower client activity Good results in non-linear rates were offset by a decline in linear rates due to market uncertainty and poor liquidity Credit: very strong quarter as structured credit and flow trading saw a return in flow volumes a
Slide 21: Investment banking revenues (vs. 1Q10)
Investment banking revenues (vs. 1Q10) Advisory: revenues increased 31% versus a market fee pool increase of 21% Capital markets: Equities: revenues declined 33% due to lower participation in IPO's and follow-ons FICC: revenues virtually unchanged Other: Risk management charges fully allocated to IB
Slide 22: Corporate Center: SNB StabFund option revaluation
The revaluation of our option to buy the SNB StabFund contributed CHF 192 million in 1Q11 Option fair value CHF 1.9 billion (USD 2.1 billion) on 31.3.11 Net income from treasury activities decreased from the prior quarter Operating expenses not allocated to the business divisions totaled CHF 46 mill
Slide 23: Capital position - Basel 2
Capital position - Basel 2 Basel 2 risk-weighted assets increased CHF 4.5 billion to CHF 203.4 billion as at 31.3.11 USD 500 million hybrid tier 1 instrument with first call date in June 20111 31.3.11 tier 1 capital and tier 1 ratio already reflect redemption (CHF billion) CHF 1.4 billion of core ti
Slide 24: Capital position - Basel 2.5
Capital position - Basel 2.5 Basel 2.5 RWAs of CHF 279 billion for the Group Basel 2.5 tier 1 capital of CHF 35.2 billion Tier 1 deduction of CHF 1.2 billion due to additional deduction for low-rated securitization exposures Pro-forma Basel 2.5 tier 1 ratio of 12.6% on 31.3.11 VaR (7) Stressed VaR 3
Slide 25: Movements in IFRS equity
Movements in IFRS equity otwhich BE attributes to IFRS equity Total attributable tof) sttributable t UBS shareholders TO"-controlling (CHF milion) Net profit 1,809 1,907 2 Foreign currency translation of foreign operations (OC) (78) (182) 104 Financial investments available-for-sale (OC) (121) (121)
Slide 26: Appendix
Appendix UBS
Slide 27: Invested assets
Invested assets Wealth Management Wealth Management Americas Global Asset Management Retail & Corporate
Slide 28: BIS regulatory capital (Basel 2)
31.3.11 BIS regulatory capital (Basel 2) 1 Includes CHF 0.6 billion due to changes in deduction items, CHF 0.3 billion due to other tier 1 changes, partly offset by CHF 0.4 billion changes in own share related components 2 Includes CHF 0.6 billion due to changes in deduction items, CHF 0.5 billion r
Slide 29: Hybrid tier 1 instruments outstanding
Hybrid tier 1 instruments outstanding1 1 All UBS hybrid tier 1 instruments are subject to phasing out for BIS tier 1 capital recognition purpose (10% per annum starting 1 January 2013) under Basel 3 2 Fixed rate until call date, floating rate coupon payment thereafter 3 If instrument called at first
Slide 30: Asset funding - 31 March 2011
125% coverage CHF 68 billion surplus CHF 116 billion collateral surplus Asset funding - 31 March 2011 Assets Liabilities and equity Cash, CBs, due from banks 43 Loans 267 Trading portfolio assets 236 Cash collateral on securities borrowed and reverse repurchase agreements 220 Other assets (incl. net
Slide 31: Balance sheet development
Balance sheet development 1 Including cash collateral on derivative transactions 2 Including financial liabilities designated at fair value 3 Percentages based on total balance sheet size excluding negative replacement values (CHF billion) Total excl. PRVs CHF 933 billion Assets Liabilities and equi
Slide 32: Exposure to monoline insurers, by rating
Exposure to monoline insurers, by rating 1 (USD billion) Credit protection on US sub-prime RMBS CDOs2 of which: from monolines rated investment grade (BBB and above) of which: from monolines rated sub-investment grade (BB and below) Total 31.3.11 12.0 2.2 0.9 1.3 Notional amount3 Fair value of CDSs
Slide 33: Student loan auction rate securities
Student loan auction rate securities (USD million) US student loan auction rate securities Carrying value as of 31.12.10 9,784 1 Includes USD 4.5 billion (CHF 4.1 billion) at carrying value of student loan auction rate securities (SL ARS) that were reclassified to "Loans and receivables" from "Held
Slide 34: Reclassified assets
Reclassified assets 31.3.11 (CHF billion) Monoline protected assets US student loan and municipal auction rate securities US reference linked notes Leveraged finance 5.3 4.4 0.4 0.4 0.7 Ratio of carrying to notional value 87% 89% 80% 77% 83% Carrying value 5.7 4.2 0.4 0.4 0.8 Fair value 6.1 5.0 0.5